Our Plan to Domicile in Texas

[@GoWithLess]

Hello! This video was before we became nomads and relied on Escapees for our mail. We recorded an updated video almost a year into using them. If this video was of interest, make sure to watch this one - kzbin.info/www/bejne/hH26lmqdpc51e6M.

[@angelabarker8611]

Amazing. So wonderful. Congratulations and good luck! Very happy for you guys you all have done so much planning.

[@GoWithLess]

Thanks, Angela!

[@ZariNation]

So on Texas and taxes. I love your tax strategy, it works very well with your plans. The state still gets their taxes somehow. Texas gets it in property taxes and sales taxes which is a bit problematic for full-time residents who are in lower tax brackets.

[@GoWithLess]

😞

[@Indyanna6245]

As future retirees, we’ll get breaks on property taxes as well

[@chithaitwins]

I recently discovered your videos from guest appearance on Retire There with Gil and Gene podcast. I've listened to a couple of your videos so far and I found them to be very informative. I look forward to perusing your playlist and videos to see which others align to my future plans. Tim, I know that you had referenced the Patriot Act in a couple of videos and you mentioned that you didn't know when this requirement came into effect. I just wanted to share that the Patriot Act is actually a short name for the acronym USA PATRIOT Act that stands for "Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001. This law was passed as a result of the 9/11 terrorist attacks in NY, DC, (PA) and included the Customer Identification Program (aka CIP) that requires banks to collect a physical address for its customers effective October 1, 2003.

[@azndude508]

This is a gem of a video and great that I found it while I'm contemplating leaving the rat race. The combination of employing capital gains tax harvesting, roth conversions for the future, while keeping total income from those capital gains low enough (but maintain a reasonably good standard of living) to maximize the ACA subsidy in a no income tax state is GAME CHANGING. I'm still years away from "retiring" but I'll be ready to put all the pieces together in the year or two leading up to that and finally ditch NYC forever.

[@loridemars4549]

Thank you for the great information and demystifying how it all works when you travel extensively. Was not aware there were resources that would help with the mail and such.

[@erinaustin9968]

Washington state also has no income tax. Oregon has no sales tax so many people live in Washington and shop in Oregon. Health insurance is daunting- maybe the actual health care cost is cheaper overseas for you and you both stay healthy!

[@GoWithLess]

First, thank you for your question on last week's video! I don't know that we would have thought to address health insurance but it completely makes sense that we did. Health care outside of the US seems to be cheaper in every other country. Thankfully, we haven't needed to use it but long periods on the road will mean even basic stuff will need to be addressed. On that note, we did post a video about a dental cleaning I had in Merida, Mexico this past spring. It was about 1/3 of the price of my cleaning at home.

[@QuesttoFIRE]

You guys are so organized and knowledgeable, but I am SO impressed by your flexibility!! You guys just roll with the punches and that is so awesome.🔥🔥🔥

[@GoWithLess]

That's a lot of nice things, there!!! Thank you so much!

[@chowceo]

I have to tell you this video got me in motion to think about converting my IRA to my Roth IRA. I am retired at 58 and have a pension, and two types of ira's. Because of you guys I started making the conversion to non taxed Ira. I live in New York State and I will be charged to convert over to a Roth. So I will do a Roth ladder conversion only enough to keep me within my tax bracket so taxes will not be charged at the higher rate. This also is a good move to make when it comes to collecting your Social Security as Social Security will be taxed including IRA withdrawals from a tax account. So having a Roth IRA and withdrawing does not bump up your Social Security taxes and Medicare eventually. Thank you.

[@GoWithLess]

Taxes are such a big consideration! We're moving to another state because of taxes. Happy you are planning ahead!

[@Floof_Factory]

I'm thinking of buying an rv and getting my domicile in texas. My question is, can I get my mail forwarding address and driver's license first in Texas, then buy/register the rv. I haven't decided which rv I want but getting the texas license and mail forwarding service first would be more convenient

[@jacqdanieles]

The conversion to a Roth had me scratching my head for a bit, but after reading the article it made sense. That's a really good tip. Thanks.

[@GoWithLess]

I was afraid that might happen. We could have spent 20 minutes just discussing IRAs. The Mad Fientist outlined it all so nicely - happy you checked out his post!

[@jacqdanieles]

@GoWithLess - you did well to highlight the option & link the article. That in itself was very helpful. Thanks for sharing!

[@GoWithLess]

When Tim learned about this concept through someone in our community and was pointed to a similar post on the Mad Fientist site in July of 2014, we were still working. We had no plans to retire for 8-9 more years. That night, he never came to bed. He woke me up at 5am (on a Sunday) ALL JAZZED UP and said "we can do it...we can retire now". Our lives changed in an instant. It still gives me goosebumps to remember it. Certainly, a life of savings, no consumer debt, etc. were necessary but the Roth IRA conversion gave us that extra bit to take the leap. Happy someone introduced it to us. Happy we could introduce it to you!!!

[@skesno309]

You should move to Illinois. We have terrible winters, one of the highest property taxes in the country and are bankrupt. Sound enticing?

[@tube.brasil]

It seems all reasonable Americans are leaving Illinois and California.

[@skesno309]

@@tube.brasil Yep, i wish i could join them but stuck for awhile.

[@GoWithLess]

Ha!! Lots of my family has lived in Chicago so I've been there quite a bit. In nice weather months, it's amazing. I went for a trip with girlfriends last October and had the full scale of weather in 3 days. Come on the road with us! We're seeking perfect weather just about every moment of our lives. That, and tacos.

[@SD-my9so]

Thank you for all that very good information. We are early retirees living currently on hobby farm in Utah, paying what my husband calls the view tax- State income tax. We did know you needed US physical address. Did not know about domicile. Good to know about the cap on capital gains harvesting. Will go to mad scientist and learn more. You two are great! Keep it up!

[@GoWithLess]

Thank you so much!! Are you tending the farm? Do you have any animals? That sounds like a fun thing to do in retirement!

[@paradiseheaven]

Thank you so much for making such informative videos. I’m just starting to learn about how to FIRE. You as a couple are inspiring. Stay safe!

[@georgiannmaloney6594]

We are looking to go to a place with milder winters when hubby retires. Yay

[@GoWithLess]

We hear you on milder winters. Last winter in Denver broke us, probably permanently. Our ideal winter gets no colder than 40 degrees and lasts a few weeks! It snowed in the Denver area on Memorial Day this past year. Thankfully, we were in perfect weather in NYC then. But still...Memorial Day!

[@nesadcruz7840]

I can see Y’all are Rarin’ to go. All the best. You have thought this out and planned well.

[@GoWithLess]

Rarin' to go, indeed!!!! We've been home for 9 days and I am ITCHING to get out again. We accepted a house sit in Denver for 3 days this weekend and are off to Washington DC for 2 conferences the very next day. Purging will have to wait...!

[@nesadcruz7840]

Have fun

[@vickikinard3287]

Great video as usual! Fantastic information and for us the transition to domiciling in Livingston was very easy.

[@GoWithLess]

That's great to know! Thank you!

[@ryanvboy]

Welcome to Texas! Hope y’all like it here.

[@GoWithLess]

Many thanks!!

[@GoWithLess]

Thanks for watching! Some of the concepts we talk in this video are involved. We've put links to resources in the video text. Each site has LOTS of information to digest. Taxes might not be the most exciting topic for many people, but they are worth considering since it really comes down to money...which IS exciting!

[@GenExDividendInvestor]

We were thinking of doing something similar.. move to a no income state tax :)

[@GoWithLess]

Lots of options...lots to consider!

[@forgednotcast612]

Hello, if you sold your home in Texas, how did you open a bank account without a physical address ? You mentioned the Patriot Act .

[@thelmaespinel8558]

I am glad for you guys , for some reason I thought you will be traveling most of the year. My cousin move to Texas and she loves it.

[@GoWithLess]

You have it right! We will be traveling outside the US roughly 10 months a year. We had to pick a place "to live" while we do that and Texas was a good pick since they don't have state income taxes.

[@BBB-bq9gl]

How do you do your banking? I know most of it can be done online, but I was wondering if you are going to use a local Texas bank/credit union or a national one or do you still have a Colorado bank and use the texas address? Just started watching and enjoy your thoughts. I hopefully will retire early but will be late 50's and do the RV thing. Texas or South Dakota will be our choice. Thanks

[@kc3190]

Any updates on how the service is working??

[@marierika2012]

We left California also because it was so expensive... I being traveling as a nurse for a living for 10 yrs so I can call myself a Nomad... I being judged by family about not being in one place for more than 6 months... I always say... I love exploring new places, and have no desire to pay non resident taxes...I just bought a house in Texas also! Best decision ever! I borrowed 100k that I plan to pay in less than 15 yrs. No debt so far, but...my plan to retire will be definitely out of the country. Property taxes here are very expensive... Got my house in North Austin.

[@craiggallup5706]

I realize you get a street address through Escapees but my understanding is that not uncommonly some banks, brokerages, and credit card companies refuse to keep doing business with people using such services. How do they know if it's a street address? Depending on how the addresses are structured, I doubt it's usually very difficult. This is a potential issue with all of these services. The services have no control over what decisions the outside firms may make. To add, they also might red flag your accounts based on where the transactions are happening, which I'm assuming over time will not be in Texas.

[@EmilyRTurk]

Craig Gallup We’ve used Escapees for over a year. If an institution, like a bank, has a problem with the Escapees address, they have no problem taking a next-of-kin address. It all depends on each institution’s interpretation of the requirements set forth in the Patriot Act Tim mentions in the beginning.

[@laurafernandezlopez8591]

Xz

[@tsc844]

Totally great tax info, thank you! Very helpful to this lives-in-Florida-but -hearts-are-in-Minnesota, newly-empty-nesters couple as we work to figure out what to do with ourselves! Good luck, guys. You are so smart. Amy, your nails look beautiful! 😊

[@GoWithLess]

Ah, thank you so much!!! I may wear nearly no makeup but I'm into a self mani-pedi. :) I think you win the hyphenated-word-of-the-day award, my friend! You sure have picked 2 opposite states. Are you a winter or summer person...or something else?

[@tsc844]

We are from the north, but have lived in FL 9 years, full time. However, we’re in our early 50”s and the last son just left for college...AND...the first grandbaby is due in MN in August. So...just trying to figure out where to be, and how to live, as my husband finishes his last years working, and after. Lots to consider, and you are the best guides!!! 😘

[@GoWithLess]

Your first grandbaby!!! Congratulations!!!!!!!

[@tsc844]

Oops I’m Oct., that is. Thank you!!

[@ZariNation]

Actually I wish I'd seen this video 5 years ago before I moved overseas. I kept my house in Texas (I moved back into it) and driver's license, voting, etc. because it's my permanent residence, though given I rented it out that may have made it a bit more complicated in terms of a true 'domicile'. I had all my mail c/o'd to my Mom since I would stay at her place over the holidays. Keep your (overpriced) US cell phone number active even if it seems like a waste of money--it's effectively your ID# these days.

[@GoWithLess]

Thank you for the helpful tip about the cell phone. From what we've read, having rental property in a different state than where you domicile is tricky if you have no real estate in the state where you do domicile.

[@pda4you]

Are you telling the kids your new address? :) Welcome to Texas, while winters are indeed nice, it was 105 on Monday here at the house so summers are warm, for sure. While we have no income tax here - my property tax (DFW area) is eye watering and increasing every year at the max allowed by law. In Utah (20 yrs ago) my state tax and property tax were not even 1/3 of what I pay now. But with no home - that should not be a big issue for you.

[@GoWithLess]

LOL! Unless the kids are planning to send us mail, prob not. 😂 I don't see us visiting much in the summertime. 105...whoa!!!!! We should be in the US around Oct/Nov each year. Let's see how it plays out.

[@pda4you]

@@GoWithLess :) Yep late Oct and November are generally quite pleasant.

[@danielle7292]

When you are in Texas, where will you be staying? ie with family, in a hotel or does the domicile thing provide temporary accommodation as part of its services? I've heard a lot of good things about Texas.

[@GoWithLess]

Great question! Escapees is set up for RVers so I don't think they have accommodations. We'll do a mix of nights with family, friends, Airbnb, hotels and house sits when we're in Texas!

[@deeb7025]

Hi Tim and Amy, what type of lawyer did you use to help advise on changing the state of domicile?

[@henryrivas8999]

Very helpful, since we will need for Europe.....thanks guys!!

[@betsysullivan4706]

Great information as usual!

[@GoWithLess]

Thank you!!!

[@media333]

Can you inform what your Escapees address looks like? Do all Escapees domiciles have the same Livingston address but maybe with some other numbers after it or such? Any problem getting businesses to accept it? I hear some domicile addresses with certain domicile-providing companies have trouble being accepted by certain businesses. And ... how did you inform the IRS of address change? Thanks!

[@GoWithLess]

Escapees' members have a box number not unlike you'd have as an apartment address. For mail that's missing that info, they manually look it up. It's a huge production and we've taken a tour of their mailroom. Super cool. Only Capital One's Venture Card has had an issue with it but easy with all other entities. It's been 2 years since we made the move, but I'm pretty sure we just filled out our tax form with our current address and that was it.

[@GoWithLess]

You might like to check out our video a year after we started with Escapees here - kzbin.info/www/bejne/hH26lmqdpc51e6M

[@media333]

@@GoWithLess Thanks! Very helpful!

[@media333]

@@GoWithLess Just watched it. Thanks! Susie Adams is an attorney for Escapees and has at least one KZbin video which goes into a few areas of domiciling a bit deeper. Link is - kzbin.info/www/bejne/nnO9kpKGe9yro6s

[@RMPalmer902]

My Husband and I , we lives in Texas too..in Missori City, and my husband still work, but we already have the plan to have an early retirement in 2 or 4 years (God's willing). May I know , where do you lives now? It will be fun to hang out with the same thought about FIRE.

[@lovinglife3954]

Great video, I live in California, I have been wondering how the capital gains o PTN the sale of my home in California would be handled if I live in another state. California is definitely aggressive in trying to get every tax dollar possible. If I move, I will likely actual live wherever I move, but knowing simply having a domicile is good information. Many years ago, I lived in Georgia and worked temporarily for awhile in California, I had to file state income taxes for each state. Did you have to file Colorado state income tax due to the sale of your home, or is that simply ignore, in a sense, because it is capital gains and not income? I realize I need to ask some professionals about my situation, but wonder how it worked for you if you don’t mind saying.

[@joanconnors5691]

Love, love, love your videos. I am so impressed with all you have learned during this process. I wish you well and wish i could go with you. If you go by PA you always have a bed. Love, Aunt Joan

[@GoWithLess]

I love that you watch us and are such a fan!!! ❤❤ We would have loved for you to join us. xoxo, Amy

[@craiggallup5706]

It sounds like that health insurance thing could really bite you over time. Have you considered establishing residence abroad? For example in Colombia for a fairly modest investment you could get permanent residency and be eligible for their quite decent national health care system and also pay an extra add on for private that would be much lower than the U.S. The quality there is rated higher than the U.S. Also of course if you based there your cost of living would be considering less than the U.S. overall, 1/2 or 1/3.

[@GoWithLess]

Such a good suggestion. We are open to being official expats in our future. For now, we want to roam. We haven't visited any country in S America yet, but Colombia is very high on my radar. Good to know they may have excellent health care at an affordable price. Have you visited/lived there? Do you have any experience with their medical system?

[@Gary65437]

I'm not concerned about converting my IRA to a roth and paying the taxes. If I take out 5% every yr it would be less than 10K, so not much if any tax due and my SS is less than 25K so that is also tax free. All depends on you having a big retirement income or not. If you're on good terms with his Ma you could rent a room for say $20 a month and she can take care of your mail. Just another idea that seems a bit more legal.

[@GoWithLess]

Picking up and moving to another state is not for everyone, that's for sure. It's in our financial interest to make the move but each person/couple should consider finances as well as "the hassle factor". We appreciate you commenting!

[@veganvintagegeek935]

I too recently got my new mailing address. And will need it for getting mail from my 9-5 job which requires me to live in the city I work in. I have a UPS store address and once I tried to use this address for work, I got a stern talking to. They checked it out to see if it was indeed a real street address, (which UPS lies about its not a real street address). And they tried repeatedly to send mail to my UPS address only to have it sent back as rejected mail. My job at has been sending me mail to my home address even though I've removed my name from my mail box years ago. Thankfully I had the common sense to add the apartment number and the mail is delivered to the right mail box. And thankfully I only had one utility bill I was still paying at my (soon to be old) address and was able to provide this to keep my job. I looked into using escapees.com but my city is not listed. So I use the website Any Time Mail Box. I have not used the mail box yet, still waiting for my voter's registration card to come in the mail, and then I can have my state ID updated since its going to expire soon any way. And I am still keeping my UPS address since its where I get most of my mail at the moment. Who knows maybe in the future I might stop using my UPS address all together.

[@GoWithLess]

We've had a UPS mailbox for years. It came up for renewal ths month and we're letting it expire. What state are you in? It sounds as though you are going through every step to make sure you're set for your next chapter!

[@veganvintagegeek935]

@@GoWithLess I'm in Illinois.

[@jannyLOML]

Roth conversion ladder, nice. I am trying to learn all these stuff now before I really need the info and its nice to see real people actually go through it and explain it in layman’s term. I just don’t understand, or can find information online on when and how do I move state, when I am ready to retire, so I can get domicile in a no income tax state? We currently live in California. When I retire I want to live in a state where there is no state income tax.

[@GoWithLess]

We love visiting California but can understand why you would want a cheaper place for taxes. Since we won't own any real estate, we didn't need to consider property taxes. You may have a big home and that may be a consideration. Tim also has ties to Texas which made it stand apart from the other states that are also free of state income taxes. Sales tax, property tax, income tax...so many taxes and 50 states. No wonder it's confusing!

[@taochentc]

Appreciate for the good advice.

[@GoWithLess]

Thank you!!

[@chowceo]

Great info. Are you going to use the Roth Conversion Ladder to convert your traditonal IRA to a Roth ? I read the first article you linked to and I' m not clear on how much money is allowed to convert from Traditional to Roth ?

[@GoWithLess]

As far as we understand, you can transfer an entire IRA to a Roth IRA but would pay taxes based upon your personal income/tax situation. Moving bit-by-bit over each year, spread out over many years allows us to take advantage of the tax-free piece. Everybody's tax situation is unique - this is our strategy. We suggest asking an accountant for advice. That way, there are no nasty surprises.

[@chowceo]

GoWithLess thank you 😊 I appreciate your response. Learned so much from this video. I retired at 57 with a NYS pension, rolled over my 457 to traditional IRA. If I would have thought it through I should have withdrawn my large emergency fund from my 457 before converting to traditional IRA 🤷‍♀️

[@theseniorthrifter9994]

You pay for US medical but do you also buy medical for international trave?. I am on medicare with a supplement but I still buy medical insurance when I sit overseas.

[@GoWithLess]

We plan to have one plan for outside the US and one in the US. Investigating the options is one of our next "projects".

[@alexavery3100]

Try a.broker called Insure My Trip

[@butheinanounou3764]

Very nice

[@kalebremillard7720]

❤️

[@henryrivas8999]

How did i miss this?

[@georgiannmaloney6594]

What about TN for retirement to live. How is that different in taxes, etc. , than Texas.

[@GoWithLess]

It looks as though TN has state income taxes. I found this - www.retirementliving.com/taxes-new-york-wyoming#TENNESSEE I love Nashville and Franklin looked very charming when we passed through a few times. Not everyone needs to move to a state without state income tax. Our situation makes us weirdos! If we're not going to have a home, then it makes sense to look at options.

[@georgiannmaloney6594]

@@GoWithLess thank you so much and best wishes My hubby wants to work till 70, but we will see what happens. I just want to go on with something different.

[@tube.brasil]

I would be surprised if the authorities don`t require a house rental contract for issuing all documents. I hope they don`t. God bless your next phase in Texas. Wonderful state, great people. Why Livingston? Just don`t start calling Tim "Bubba", ok?

[@GoWithLess]

A true LOL! I must have a thousand nicknames for Tim. When I'm in a goofball mood, I call him "Pa" every once in a while. Bubba is just a little hop over... Escapees will walk us through the steps we need to take to make everything official. No rental/property required! The way their address operates, it covers the "address" requirement. Since they're located in Livingston, that's where we'll be. It's about an hour from Houston. Houston in nice weather months might be nice! Tim lived there and talks about the oppressive humidity and gigantic mosquitoes so you won't see us there during the summertime.

[@CentsibleLivingWithMoneyMom]

Great. When will you all be coming to visit me in Dallas? I will feed you!!!

[@GoWithLess]

Hi Dawn! There is a great chance we will pass through Dallas this winter/spring. We would love to meet you! And, I've been dying to have you feed me since I saw your first video. :) Thank you!

[@CentsibleLivingWithMoneyMom]

What are your favorite foods?

[@GoWithLess]

@@CentsibleLivingWithMoneyMom Isn't that so nice? Tim and I are super duper easy!!! We eat just about everything. No liver, brains, feet kind of stuff. :)

[@naomiking2442]

Come visit Waco... I'd love to host you :)

[@GoWithLess]

Thank you!!! So nice of you to offer!

[@sheilag9345]

clever!

[@GoWithLess]

Thank you!

[@kalebremillard7720]

😇😇

[@kalebremillard7720]

😇❤️😀

[@kalebremillard7720]

😁😁

[@mitchlasage5062]

Texas Texas Texas Texas Texans how many times have you said Texas. I can't believe you didn't tell us the name of the city or maybe I just got out of interest in Switched videos. what's the name of the city is very important because not all of Texas has the same because it's so big the spirit of the state may be the same but the terrain and and the beauty of each city is of its own. Houston and Dallas are very close to each other with the landscape is completely different. The Dallas-Fort Worth area the Metroplex is beautiful. Houston is gigantic and it's pretty in its own right. San Antonio's got five weather zones, Austin is rugged beautiful a mountainous. El Paso my hometown is quite beautiful too and it has its own Beauty. my apologies I went back to the video and I see that it's not about Texas it's about taxes. And might I say you did a good job explaining

[@GoWithLess]

Wow, what a turnaround in one comment! Thank you for updating! We'll be spending time in Texas each year. Thanks to your notes, I'm looking forward to discovering the different areas!